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Henderson budget study that omits employee pay raises questions

Henderson budget study that omits employee pay raises questions

Henderson Assistant City Manager Fred Horvath said cutting the pay and benefits of Henderson city employees was off limits to the Special Budget Ad Hoc Committee because nearly 60 percent of the employees are governed by six collective bargaining agreements, and the state runs the Public Employees’ Retirement System. (Carri Geer Thevenot/Las Vegas Review-Journal)

Henderson budget study that omits employee pay raises questions

Henderson City Manager Jacob Snow, left, and Henderson council members Sam Bateman and Gerri Schroder listen to the annual State of the City address at Green Valley Ranch on Feb. 5. Assistant City Manager Fred Horvath said Snow made cuts of Henderson employee pay and benefits “off limits” to the Special Budget Ad Hoc Committee. (Samantha Clemens/Las Vegas Review-Journal)

COMMUNITY MEETINGS

Community meetings are being held to discuss recommendations to meet budget shortfalls involving Henderson’s operational and capital needs. Recommendations include rate increases for city services, service cuts, alternatives to service delivery and revenue enhancements including a property tax ballot initiative. The meetings are scheduled for:

A special budget committee formed last year was told not to look to Henderson employee pay and benefits for cuts as ways to bridge budget shortfalls.

This is despite the fact that approximately 80 percent of the city’s $225.5 million general fund goes to employee pay packages.

City Manager Jacob Snow, in his opening remarks Sept. 4 to the Special Budget Ad Hoc Committee, made the subject “off limits,” according to Fred Horvath, assistant city manager.

The reason, according to Horvath, was because nearly 60 percent of city employees are governed by six collective bargaining agreements, and the state runs the Public Employees’ Retirement System.

“Salaries and benefits were not part of this committee’s purview,” Horvath said.

The committee’s report presented to the City Council on Feb. 18 recommended a variety of options to help bridge a $2 million operational and $17 million annual infrastructure deficit — including reducing park and recreation hours, increasing certain city fees and a potential 20 cent per $100 assessed value property tax increase.

The absence of a pay and benefits discussion in the report has been noticed by some Henderson residents during the city’s Bridging the Budget Gap meetings this month. The next meeting is Tuesday at 9 a.m. at Heritage Park Senior Facility, 300 S. Racetrack Road.

Thom Reilly, former Clark County manager and facilitator of the ad hoc committee, said the committee warned the city that the community would ask about employee packages even though it was not part of the report.

“The committee did say very specifically that if (Henderson) is going to go for an increase in property tax, you’re going to have to be prepared to address the (pay and benefits) issue,” Reilly said. “You are a service industry and most of your budget is pay and benefits, you’re going to have to address what you have done and what you plan to do.”

Horvath said the ad hoc committee did ask questions about employee pay and benefits.

“There was an overall high-level conversation about the challenges with salary and benefits being 80-plus percent of the (general fund) budget,” Horvath said.

Victor Joecks, researcher and executive vice president of the Nevada Policy Research Institute, a conservative think tank, said not addressing pay and benefits when it’s the “lion’s share of the budget” is not realistic.

“There’s no point in trying to save money at the margins when the thing that is driving all your spending you’re ignoring,” Joecks said.

The city is completing a compensation and classification study that will show Henderson officials where employee salaries and benefits compare to other municipalities and some private sector businesses. Joecks said the city should be prepared to roll back some pay if the report shows some positions are being overpaid.

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